MHC class I molecules are the major receptors for viral peptides and serve as targets for specific cytotoxic T lymphocytes. HIV-1 specifically decreased activity of an MHC class I gene promoter up to 12-fold. Repression was effected by the HIV-1 Tat protein derived from a spliced viral transcript (two-exon Tat). These studies define an activity for two- exon Tat distinct from that of one-exon Tat and suggest a mechanism whereby HIV-1-infected cells might be able to avoid immune surveillance, allowing the virus to persist in the infected host.